Farmers growing conventional corn next to GM crops can benefit from the reduction in crop-destroying pests without paying the premium for GM seeds, a new study has shown.

The research, published today in the journal Science, examined 14 years of records in the top US corn-producing states of Minnesota, Illinois, Iowa, Nebraska and Wisconsin, looking at the prevalence of the European corn borer, a moth whose caterpillars eat into corn stalks and topple the plants.

The so-called Bt GM corn varieties were first planted in 1996 and produce toxins taken from a soil bacterium called Bacillus thuringiensis, which is deadly to the pest. In GM fields, the pest is eradicated, but the data showed that in neighbouring non-GMO fields the pest populations shrank by 28-78%, depending on how much GM corn was being grown in the surrounding area.

The study also found that the caterpillar-killing GM varieties grown in the vast US corn belt had retained their potency 14 years after being first sown, showing the pests had not developed resistance.

Scientists said the demonstration of the "halo effect" was a triumph for genetically modified crops. Prof Bruce Tabashnik, an entomologist from the University of Arizona, who was not part of the research team, said: "It's a wonderful success story. It's a great example of a technology working how it should."

But anti-GM campaigners claimed the full economic, environmental and social impacts of GM crops were not considered. "There are a whole host of negative impacts which need to be taken into account," said Kirtana Chandrasekaran, food campaigner at Friends of the Earth. "Snapshot studies like these do not give the whole picture."

The researchers, led by Prof Bill Hutchison at the University of Minnesota, also calculated the economic benefits over the 14 years of the GM corn-growing. They valued the extra corn harvested because of the reduction in corn borer numbers and took into account the extra $1.7bn farmers had paid for the GM seeds, equivalent to $10-20 per hectare. The total benefit was $6.8bn but they found it was not evenly distributed: non-GM fields gained two-thirds of the total benefit, despite making up only one-third of the land.

"A grower who is completely non-GM is clearly benefiting in terms of less European corn borer pressure, and damage to their crops," said Hutchison, while adding that many farmers in the midwest grew both GM and non-GM corn. He believes the halo effect will apply to other GM crops. Hutchison has previously received small grants from GM seed producers to conduct independent trials of their crops.

Chandrasekaran said there are major costs not accounted for by the study, including the loss of income and clean-up costs when GM crops contaminate conventional varieties. She citeed the example of unnapproved GM rice strains found in the US long-grain rice supply in 2006, which led to European countries and Japan blocking rice imports. A class action lawsuit is ongoing and the seed company, Bayer CropScience, has already lost four individual cases and been asked to pay millions of dollars in compensation. Chandrasekaran also said there were environmental costs such as GM-derived toxins in Bt crops running off fields after rain and harming aquatic life.

All sides agree that the rapidly rising proportion of the corn crop grown that is GM is a matter of concern because it could help the corn borer to develop resistance to the Bt toxin. This is because non-GM "refuges" allow some moths that are susceptible to the toxin to survive, and then mate with the few that are naturally resistant, rendering their offspring vulnerable too.

"If the Bt crop use – currently 63% of all US corn – gets too high, we are still concerned with the risk of the corn borer and other insect pests developing resistance, and thus loss of a valuable technology," said Hutchison. The US Environmental Protection Agency has recently approved a "refuge in the bag" approach, in which a mix of 90% GM corn and 10% non-GM corn is sold. Previously farmers had to plant at least 20% non-GM corn. "As we transition to this, I do have concerns about long-term resistance management and sustainability of the technology," Hutchison said.